In today’s article we are going to be discussing how to consolidate your old pensions. Very few of us have a job for life these days, with many of us moving through numerous roles and businesses as our careers progress. That means you’ll probably have several workplace pensions throughout your working life and as time passes it can be very easy to lose track of them. You might have moved house since leaving a previous job and your pension provider doesn’t have your new address. Or perhaps the pension provider has rebranded and merged with another company, but you’re not aware of the change.
So if that sounds like the situation you are in, what do you need to do?
The first thing to do is to go through your files at home and see if you have any old paperwork relating to your pension schemes. Even if you’re not getting any statements through the post, perhaps because you’ve moved house in recent years, your old paperwork might contain some useful information, so you can contact the pension provider directly, or find out what’s happened to the company in the intervening years.
Another option is to get in touch with your previous employers. It may be that a company you worked for ran the pension scheme, in which case they could be able to help you find the details you’re looking for or, if they didn’t run it themselves, they may be able to tell you which company did.
Alternatively, you can make use of various services that have been set up to help you track down old pensions, such as the Money and Pensions Service (MaPS). Finally, it may be the case that you’ve not moved house but have simply ignored your statements when they drop through the letterbox each year. Don’t disregard this mail; make sure it’s properly filed with the rest of your important documents, so you can feel confident you’re on top of everything from now on. Otherwise, you might find yourself back where you started in a few years’ time.
How many people have lost track of their pensions?
If you’ve lost track of previous pension schemes, you’re far from alone. In fact, a recent study by Scottish Widows revealed that more than 3.6 million people in the UK have no idea how many pensions they have. This may explain why nearly three-quarters like the idea of creating a new system that automatically consolidates small pension pots as they move from one job to another. The research also highlighted some significant gaps in people’s knowledge, with one in ten respondents saying they had no idea how to combine their pensions, while a similar proportion felt it would be “too much hassle”.
What are my options How can Howard Wright help me consolidate my pensions?
We’re here to tell you that it doesn’t have to be really difficult and you can always speak to us at Howard Wright a professional, regulated firm of chartered financial planners about consolidating old pensions and planning your finances for the future. It is worthing noting here that just because you can consolidate your pensions, it doesn’t mean that you should in every circumstance.
Consideration needs to be given to a range of factors to establish if consolidating the contracts is the right thing to do. Many of the current day employer auto enrolment schemes are very similar, but this does not mean that they are the same. If both pensions are similar but one is more expensive than the other, would it make sense to consolidate to the more expensive version just because it’s the most recent pension, possibly not. Some of the older contracts may also have some very valuable benefits that could be lost if you were to consolidate this into a new arrangement. Some of these benefits could include, extra tax free cash on retirement over and above the usual 25%, guaranteed income rates higher than those available on the open market, funds with guaranteed growth rates. Whilst this is not an exhaustive list it highlights that not all pensions are the same and if you were to transfer out of an arrangement with these benefits just for the sake of consolidation, these valuable benefits could be lost forever.
This is why seeking the advice of a regulated financial adviser such as Howard Wright could prove to be invaluable. If you have any questions about your pension planning, please don’t hesitate to get in touch with us and we’ll be happy to answer any questions you have and provide advice where necessary.
How to contact us?
If you would like to discuss your Annual Allowance options and what is best for you and your finances with Ashley Smith one of our Chartered Financial Planners at Howard Wright, you can call him on 0345 688 4939 or you can fill in our enquiry form below, it only takes 20 seconds to complete. We look forward to hearing from you and seeing how Ashley can help. The best way to contact me and our Chartered Advisers is to fill in our enquiry form or phone us on 0345 688 4939 we will then be able to advise you on the best way to consolidate your pensions. We look forward to hearing from you and seeing we can help.
Disclaimer
This article contains information from sources believed to be reliable but no guarantee, warranty, or representation, express or implied, is given as to its accuracy or completeness. Howard Wright Ltd does not undertake any obligation to update or revise any future statements. Past performance is not a reliable indicator of future results. Investments can go down as well as up and actual results could differ materially from those anticipated. This article is for information purposes only and has no regard to the specific investment objectives, financial situation or particular needs of any person as such, the information contained in this article is not intended to constitute, and should not be construed as, investment or financial advice. Appropriate personalised advice should be taken before entering into any transactions. No responsibility can be accepted for any loss arising from action taken or refrained from based on this publication. Howard Wright Ltd is Authorised and regulated by the Financial Conduct Authority.